EUR/GBP retreats further from weekly top after ECB Stournaras’ dovish comments

EUR/GBP stalls a three-day-old uptrend in reaction to dovish remarks by ECB’s Stournaras.
Delayed BoE rate cut bets underpin the GBP and further contribute to the intraday decline.
Investors will keep a close eye on comments by other ECB officials for short-term impetus.

Haresh Menghani FXStreet

The EUR/GBP cross comes under heavy selling pressure on Thursday and for now, seems to have snapped a three-day winning streak to the 0.8560 area, or the weekly top touched the previous day. Spot prices drop to the 0.8535 region, or the fresh daily low during the first half of the European session and remain well within the striking distance of the monthly trough touched earlier this week.

The shared currency meets with some supply after European Central Bank (ECB) Governing Council member Yannis Stournaras backed the case for an early rate cut. Stournaras added that he doesn't buy the argument that the ECB cannot cut rates before the Fed and that four rate cuts in 2024 seem reasonable. This comes after several ECB officials floated the idea for the first rate cut in June and a further move in July, which, in turn, exerts pressure on the EUR/GBP cross.

The British Pound (GBP), on the other hand, remains well supported by expectations that the Bank of England (BoE) will keep interest rates higher for longer. The bets were reaffirmed by the monthly UK GDP print on Wednesday, which showed that the economy returned to growth in January after entering a shallow recession in the second half of 2023. This, in turn, is seen as another factor that contributes to the heavily offered tone surrounding the EUR/GBP cross.

Moving ahead, there isn't any relevant market-moving economic data due for release on Thursday, either from the Eurozone or the UK. Hence, investors will keep a close eye on comments from ECB policymakers, which will continue to influence the Euro and provide some impetus to the EUR/GBP cross. Apart from this, the top-tier US macro data might infuse some volatility in the markets and further contribute to producing short-term trading opportunities.

EUR/GBP

Overview
Today last price	0.8541
Today Daily Change	-0.0013
Today Daily Change %	-0.15
Today daily open	0.8554

Trends
Daily SMA20	0.855
Daily SMA50	0.8557
Daily SMA100	0.8612
Daily SMA200	0.8608

Levels
Previous Daily High	0.856
Previous Daily Low	0.8538
Previous Weekly High	0.8568
Previous Weekly Low	0.8504
Previous Monthly High	0.8578
Previous Monthly Low	0.8498
Daily Fibonacci 38.2%	0.8552
Daily Fibonacci 61.8%	0.8547
Daily Pivot Point S1	0.8542
Daily Pivot Point S2	0.853
Daily Pivot Point S3	0.8521
Daily Pivot Point R1	0.8563
Daily Pivot Point R2	0.8572
Daily Pivot Point R3	0.8585

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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